Hawaii House Bill HR151

Hawaii 2022 Regular Session

• Introduced: 3/11/22
• Refer: 3/14/22

Caption

Requesting The Department Of Taxation To Conduct A Study To Determine The Potential New Revenue For The State Resulting From A Tax On Electronic Smoking Devices.

Impact

If implemented, the findings from the requested study could lead to legislative proposals that reshape Hawaii's tax structure regarding tobacco products. The current disparity in tax rates between traditional tobacco products such as cigarettes and newer electronic smoking devices creates an economic incentive for consumers to shift towards e-cigarettes. This resolution seeks to address these discrepancies to ensure a more equitable taxation framework and potentially increase state revenue from a previously under-taxed market segment.

Summary

H.R. 151 is a resolution requesting the Department of Taxation in Hawaii to conduct a study aimed at exploring potential new revenue streams for the state through taxation on electronic smoking devices, commonly known as e-cigarettes. This legislative measure arises amid a backdrop of increasing e-cigarette use, particularly among youth, while traditional cigarette consumption has seen a decline. The resolution highlights a significant growth in e-cigarette sales within the United States, which have reportedly surged by nearly three hundred percent from late 2016 to mid-2019.

Contention

There may be notable points of contention regarding this resolution, particularly around public health implications and regulatory measures. Proponents of the proposed taxation argue that generating revenue from e-cigarettes could help offset state costs associated with public health programs. However, critics might contend that higher taxes on e-cigarettes could inadvertently discourage cessation efforts or drive consumers back to traditional, more harmful tobacco products. Furthermore, any regulations developed would need to consider the nuances of flavored e-cigarettes, which would require alignment with federal legislation on this aspect.